Update: Warner Bros. and Fox Settle Watchmen Dispute

Warner Bros. and Fox have resolved their dispute over Watchmen, with the studios scheduled to present the settlement to Judge Gary Feess on Friday morning and request that the case be dismissed, says The Hollywood Reporter.

Terms of the agreement will not be disclosed, but it is said to involve a sizable cash payment to Fox and a percentage of the film’s box office. Fox will not be a co-distributor on the film, nor will it own a piece of the Watchmen property going forward. The studios are set to release a joint statement announcing the agreement Friday.

Fox sued Warners in February of 2008, claiming copyright infringement based on agreements the studio had with producer Larry Gordon. Feess ruled on Dec. 24 that Gordon did not secure the proper rights to Watchmen from Fox before shopping the project and eventually setting it up with Warners. Feess’ decision prompted settlement talks to heat up because Warners faced the prospect of an injunction stopping its March 6 release of the $130 million comic book adaptation.

While Gordon is not a party to the case, Warners is said to be pursuing the producer and his attorneys to reimburse it for the costs of the settlement.

UPDATE: Here is the official statement from both studios…

Warner Bros. and Twentieth Century Fox have resolved their dispute regarding the rights to the upcoming motion picture Watchmen in a confidential settlement. Warner Bros acknowledges that Fox acted in good faith in bringing its claims, which were asserted prior to the start of principal photography. Fox acknowledges that Warner Bros. acted in good faith in defending against those claims Warner Bros. and Fox, like all Watchmen fans, look forward with great anticipation to this film’s March 6 release in theatres.